LLQP Accident & Sickness · Component 1.3 · 35% of the exam
A client's greatest single expense is his children's private school tuition. In a disability analysis:
- AIt is left out, since private school tuition is discretionary spending
- BIt is covered by the CPP children's benefit if he qualifies for CPP disability
- It is a continuing expense he would want to maintain, unless he decides to cut it
- DIt is a business expense, since the fees are paid from the corporation's account
Correct answer: C) It is a continuing expense he would want to maintain, unless he decides to cut it
The need reflects the standard of living the client wants to preserve. Discretionary but important expenses are included if the client would keep them; the client decides, informed by cost.
Why the other options are wrong
- AIt is part of the family's standard of living.
- BCPP children's benefits are small and unrelated to tuition.
- DTuition is a personal household expense.
Exam tip
Include the expenses the client would keep during disability; let the client decide which.
Common mistake
Deciding for the client which expenses 'count'.
What this tests
CISRO competency component 1.3 — Assess the client's needs and situation — which is weighted at 35% of the Accident & Sickness module. Written against the published curriculum.
More from component 1
- The single most important fact for sizing a client's disability income need is:
- A client's beneficiaries for assets are listed in the fact-finding. Why does this matter for A&S planning?
- A client asks why the agent wants to know how assets are owned (jointly or individually). In the A&S context the answer is:
- A client mentions a back injury five years ago that fully resolved. The agent should:
- Which element of a client's situation most affects the definition of disability that should be recommended?
- Which of the following health facts is most relevant to a client's disability insurance situation?
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.